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The Memory Scene: Drivers and new roadmaps


Regardless of what you might think of the Apple iPhone 4S, the demand forecasters love it thanks to pent up demand due to the 16 month interim since the last hardware release and many new and/or refresh sales available.  Despite some analysts' disappointment with no low-cost iPhone version (e.g., this iSuppli report), the continued availability of a free 3GS or US $99 4 model, with service plans, means that 'smart becomes average' for the lower-cost customer as an iPhone moves into reach.  Meanwhile, the Samsung Nexus S does offer a near field communication (NFC) payment on Andriod through Sprint, so those features are already on the market.  Apple's next iPhone, believed to be less than a year away is rumored to contain the NFC capabilities (requires hardware-software co-build and R&D), according to reports such as this one from ComputerWorld.

What does all this smartphone news have to do with memory?  The smartphone and tablet PC markets are not only the lifeblood of the consumer electronics market during these otherwise demand sparse times, they are also influencing the memory roadmap beginning next year and certainly by 2013, as reported in this ComputerWorld article.

The memory roadmap is best informed by considering how the sector has been playing out this year as well as what drivers have enough weight to compel CAPEX spends.  While memory has continued its volatility this year, recently there has been enough data to characterize movement as a stabilizing in pricing, particularly for NAND flash, as well as some upticks for DDR2 and DDR3 for consumer electronics.  Notably contributing to the pricing stabilization is the inventory situation which continues to be healthy due to lean inventory management in the face of downgraded forecasts by manufacturers.  One lingering value chain issue is that should demand pick up, shortages are likely to arise because of the lean inventory situation.  High utilization with no increases in new lines, this is a manufacturing situation facing memory, and others along the component spectrum, as we have been commenting on both in MarketWatch Commentary and in our recent MarketWatch Quarterly.

Looking ahead, there is quite a bit of talk around new DRAM and NAND roadmaps with industry hopes for consumer interest in the new line of Ultrabooks in addition to increasingly rich offerings from smart wireless devices (SWDs), that is, smartphones, eReaders and tablet PCs.  Notably is the recent talk from Intel, Samsung and Micron (see here and here from ComputerWorld) around memory improvements and changes to meet the feature demands for smaller footprints, lower power consumption while increasing data transfer rates.  Additionally, there is the recent discussion here of the 2013 release from the HP-Hynix collaboration for new memristor memory to replace flash.  Notably, the forecasts show significant shift favoring LPDDR3 as the latest ramp for mobile and ultrabook solutions; DDR4 to be the leading memory beginning in 2014 as the successor for mainstream computing and servers; and by 2015, Hybrid Memory Cubes (HMC) are initially being touted as innovative replacements for DDR3 in high-performance solutions, particularly for the growing server market, but is not forecasted to hit consumer markets until well out due to costs.

In short, memory continues to innovate and respond to demand trending as well as closely monitoring the difficult market conditions.  Inventory controls are in place and continue to show healthy results, until the point when demand upticks could very well lead to shortage situations.

Lisa Ann Cairns, Ph.D.
Written on Friday, 07 October 2011 12:08 by Lisa Ann Cairns, Ph.D.

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